Griffin Mining Ltd. Annual Report 2008

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FY2008 Annual Report · Griffin Mining Ltd.

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CONTENTS

CHAIRMAN’S STATEMENT

REVIEW OF OPERATIONS

DIRECTORS & SENIOR EXECUTIVES

DIRECTORS’ REPORT

REPORT OF THE INDEPENDENT AUDITOR

CONSOLIDATED INCOME STATEMENT

CONSOLIDATED BALANCE SHEET

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

CONSOLIDATED CASH FLOW STATEMENT

ACCOUNTING POLICIES

NOTES TO THE FINANCIAL STATEMENTS

CORPORATE INFORMATION

Griffin Mining Limited is a mining and investment company whose principal asset
is the Caijiaying zinc-gold mine. Further information on the Company is available
on the Company's web site: www.griffinmining.com.

Griffin Mining Limited's shares are quoted on the Alternative Investment Market (AIM)
of the London Stock Exchange (symbol GFM).

Registered number: EC13667 Bermuda.
Registered Office: Clarendon House, 2 Church Street, Hamilton HM11, Bermuda
United Kingdom office: 60 St James's Street, London SW1A 1LE

Page

G R I F F I N M I N I N G L I M I T E D

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Caijiaying Mine Site Winter 2009 During Upgrade Construction

G R I F F I N M I N I N G L I M I T E D

CHAIRMAN’S STATEMENT

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2008 will go down as one of the most catastrophic

as one of the world’s lowest cost zinc producers.

Spitfire Oil Limited, a company listed on the AIM

make any acquisition of these assets prohibitively

years for all involved in the mining, financial and

With the continuing depressed commodity prices,

of the London Stock Exchange. This company is

difficult and uneconomic. Even without any further

industrial markets. Almost every institution,

the Company took the opportunity to temporarily

attempting to economically extract fuel oils and

acquisition, the Company’s future looks assured.

company and individual was affected, some

suspend operations at Caijiaying to undertake long

other by-products from the huge Salmon Gums

The industrialization of China and its spectacular

irrevocably, and your company, Griffin Mining

overdue heavy maintenance and complete

lignite deposit in Western Australia. This is a long

growth rate, although temporaily slowed, should

Limited (“Griffin” or the “Company”) was no

construction associated with the expansion of

term, high risk venture. But the economic rewards,

return and re-ignite the “super cycle”

exception. Even in this difficult environment, the

production facilities. The economic cost of

should Spitfire Oil Limited be successful, will be

commodity prices. The Company’s balance sheet

Company was still able to produce a profit before

suspending operations was relatively small

enormous and Company transforming.

is very strong with a large cash balance and no debt.

tax of almost $7 million, a truly remarkable result

compared to suspending operations at a time of

The Company is beginning to increase throughput

considering the zinc price fell 46% in 2007 and a

high commodity prices. By the beginning of June,

Less successfully, in April 2008, the Company

at Caijaying towards 750,000 tonnes per annum

further 50% in 2008. This is a testament to the

full operations should have resumed at Caijiaying.

negotiated an agreed merger with Yukon Zinc

and Caijiaying continues to be a low cost mine

quality of the Caijiaying mine, its people and the

Corporation, which was subsequently frustrated

with the potential to become a world class mining

management of the Company.

The current environment does, however, provide

by a higher takeover bid by Northwest Non

region, particularly with further exploration

some unique acquisition opportunities which the

Ferrous International Investment Company

between Zones II and III at Caijiaying.

2008 was unique, not in that it produced the

Company would like to pursue.

As most

Limited and Jinduicheng Molybdenum Group

beginning of a severe and prolonged recession. It

shareholders are aware, in a booming commodity

Limited. Nevertheless, the Company was still

Logically, all these activities require smart, efficient

is the task of any competent management to foresee

market, mining companies and mining assets are

able to walk away from the transaction with a

and tireless human capital. The Company has

such likelihood. Rather it was the complete

given astronomical valuations. Even the small

C$2.5 million break-up fee. Finally, and probably

always prioritized obtaining, maintaining and

breakdown of the financial system, including the

number of assets the Company thought met the

most disappointingly,

in March 2009, the

keeping the best possible staff because, at the end

banking, equity and debt markets, that produced a

financial, political, structural, metallurgical and

Company made an unsolicited bid for a Canadian

of the day, people make things happen. To the

scenario that none of us had ever seen before and

geological parameters set by the Company, were

company, Ivernia Inc, the owner of the suspended

Company’s

directors,

senior management,

brought the world to the edge of financial calamity.

financially out of reach. The current economic

Magellan Lead Mine in Western Australia. That

contractors and Chinese employees go all of our

The ensuing ricochet effects caused the current

crisis has savagely slashed these companies’

company’s management took the unfathomable

thanks and gratitude. We also welcome Investec as

recessionary environment and,

for mining

valuations and, in some cases, left them in a

decision to deliver effective control, through

our new Nominated Advisor and Broker. We hope

companies, the unfortunate end to booming

precarious financial predicament with little or no

massive dilution of its share capital, to a related

our relationship will be long and mutually

commodity prices. In a fixed cost business such as

cash and no hope of raising further funding to

party without shareholder approval. That made

beneficial.

mining, the resulting dramatic fall in revenues

survive. It is these companies that management has

the acquisition of Ivernia uneconomic and

caused by declining commodity prices was reflected

been evaluating and attempting to acquire.

unpalatable for Griffin.

Lastly to you, our shareholders and owners, we

directly in a corresponding fall in the profitability

pledge to continue to add real value and work even

of the Company.

The Company made a number of acquisition

None of this has dampened the Company’s

harder to bring the rewards your loyalty has earned

attempts during the year. On the plus side, in May

enthusiasm to make further acquistions in this

over the course of this difficult year.

Fortunately for Griffin, prudent management has

2008, the Company bought back its own shares

recessionary environment where the Company’s

ensured that a significant cash balance has been

from Citadel Investment Group, realising a gain

cash has inordinate value, particularly before

Mladen Ninkov

maintained in the Company, no debt exists on the

of over $30 million. From the same seller Griffin

commodity prices start to rise again and the

Chairman

balance sheet and the Caijiaying mine is managed

was able to acquire, for £2.5 million, over 39% of

valuation of mining assets become so high as to

30 April 2009

G R I F F I N M I N I N G L I M I T E D

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Main Zone III Decline Caijiaying Mine Site

G R I F F I N M I N I N G L I M I T E D

OPERATIONAL REVIEW 2008/09

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OVERVIEW

HISTORY OF CAIJIAYING

Griffin Mining Limited (the “Company”) and its

to be undertaken with relatively little economic loss

The Mine is located at Caijiaying, which is

established in 1994, in which Griffin, through its

subsidiaries (together the “Group”) recorded a

being incurred by the Group.

approximately 250 kilometres north-west of Beijing

wholly owned Hong Kong subsidiary, China Zinc

profit before tax for the year of $6,959,000 (2007:

in the Hebei Province. The site is easily accessible

Limited (“China Zinc”), holds a 60% equity

$26,762,000).

Griffin benefited from

interest receipts of

by two separate freeway systems from Beijing and

$4,670,000 during 2008 (2007: $5,607,000),

secondary sealed roads. The site has significant

All mining companies faced serious challenges

however, this income has decreased during 2009

water supplies, two independent connections to the

during 2008, however, the Group was positioned

with declining interest rates world-wide. Griffin

electricity grid, full connectivity to fixed and

better than the vast majority of its fellow industry

also benefited from a C$2.5 million break free on

mobile telecommunications and broadband access

participants in maintaining a low cost, long life

the Company’s aborted acquisition of Yukon Zinc

for internet services. Climatic conditions are not

interest and the Chinese joint venture partners

(which include the Zhangjiakou City People’s

Government, the Hebei Bureau of the Ministry of

Land and Resources and the Third Geological

Brigade) a 40% interest.

mine and retaining substantial cash balances. The

Corporation.

Group has benefited from receiving 100% of the

severe with warm summers and cold, dry winters.

In January 2004, a second contractual joint venture

company, Hebei Sino Anglo Mining Development

profits of the Caijiaying Zinc-Gold Mine (“the

Foreign exchange losses of $3,221,000 were

The assets of the Mine are held by Hebei Hua Ao

Company Limited (“Hebei Anglo”), was formed to

Mine”) over the three years to July 2008 and

recorded in 2008 (2007: gains of $1,012,000)

Mining Industry Company Limited (“Hebei Hua’

hold the mineral rights to the area surrounding the

obtaining a net gain of over $30 million, recognized

primarily on sterling deposits held to cover sterling

Ao”), a contractual co-operative joint venture entity

original Hebei Hua’ Ao licence area and any other

through reserves and not in the profit for the year,

commitments. The losses follow the fall in the

by repurchasing $121.5 million of its own shares for

value of sterling in the year.

cancellation in May 2008 from Citadel Equity

Fund Ltd (“Citadel”) having issued those same

On 27 November 2008, Griffin acquired

shares for $151.7 million in August 2007.

16,666,667 ordinary shares at £0.15 per share for a

total cost of £2,500,000 ($4,542,000) in Spitfire Oil

With the Group’s primary income generated by the

Limited (“Spitfire”). This represents 39.2% of the

Mine, profitability was severely impacted by the fall

issued share capital of Spitfire. Spitfire’s principal

in the price of zinc. During 2008, the zinc price

asset is the Salmon Gums Lignite deposits in

quoted on the London Metals Exchange fell from

Western Australia from which Spitfire is intending

$2,500 per tonne to $1,100 per tonne. Due to this

to produce fuel oil, distillates and other by-

price decline and the Group remaining unhedged

products. This relatively modest investment

to both metals and currency, a decision was taken

provides Griffin with an entrée into a long term,

to suspend operations in the first quarter of 2009 to

large scale project that spreads the Company’s

allow much needed maintenance and capital work

political and commodity risk.

Caijiaying Mine Location: Courtesy of Google Maps

G R I F F I N M I N I N G L I M I T E D

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areas of interest in Hebei Province. Griffin,

administration building extensions and other site

Profitability was also impacted by a fall in the head

second processing circuit to produce a gold, silver

through its wholly owned UK subsidiary company,

infrastructure. The construction of a new crushing

grade of zinc during the year, a normal occurrence

and lead concentrate in December 2007 and the

Panda Resources Limited, has a 90% interest in

circuit has not yet been completed and a second

given the numerous lodes carrying various grades

commissioning of a backfill plant

fill

Hebei Anglo. The other Chinese shareholders in

Hebei Anglo hold 10% and reflect those

shareholders in Hebei Hua-Ao.

Griffin, through Hebei Hua’ Ao and Hebei Anglo,

has a controlling interest in mining and exploration

licences over 67 square kilometres at Caijiaying.

Application has been made for further exploration

licences in the surrounding area.

In 2005, Griffin successfully commissioned the mine

and processing facilities at Caijiaying, on time and

within budget, with an initial design production rate

of 200,000 tonnes of ore per annum. Production

rates have been

steadily

increased

since

commissioning with 491,848 tonnes of ore

processed in 2008 and processing rates equivalent to

600,000 tonnes of ore per annum recently achieved.

primary ball mill purchased but not yet installed.

of zinc mineralization and the scheduling of mining

underground voids caused costs to increase.

When completed, this should enable processing

of these different lode systems. To date, mining

Administrative costs have also increased in China

capacity to be increased to 750,000 tonnes of ore

operations have been directed at the upper levels of

with local managers being appointed by the Chinese

per annum.

the mine. Development of the lower levels of the

joint venture partners to certain administrative

MINE OPERATIONS

Production capacity continued to increase at the

Mine which allowed tonnes of ore processed to

increase from 409,193 tonnes in 2007 to 491,848

tonnes in 2008. It also allowed the production of

a second concentrate to be produced containing

lead, silver and gold.

mine were delayed by permitting issues and, in

positions following the start of the Chinese profit

particular, delays in obtaining an environmental

sharing in July 2008. With the difficult state of the

permit required for the expansion of mining

mining industry, all costs are being reviewed to

operations. The Company has been advised that

ascertain where costs can be reduced including,

these issues have now been resolved and work

renegotiating terms with all contractors.

should begin on developing the lower levels shortly.

Underground mine development has continued

Zinc metal in concentrate produced was increased

throughout 2008 in order to provide increased

from 21,781 tonnes in 2007 to 22,922 tonnes in

throughput to the processing facilities. The main

2008, gold produced increased from 15 ounces in

“Northern Decline” has been to be extended to the

2007 to 2,421 ounces in 2008, silver produced

lower levels although development of the lower

The upgrade of the processing plant did encounter

increased from 6,470 ounces in 2007 to 171,888

levels were delayed by permitting issues. During

delays and difficulties due to a number of reasons.

ounces in 2008 and lead produced increased from

2008, 433,274 tonnes of ore were mined (2007:

In the first instance poor design work was produced

13 tonnes in 2007 to 1,127 tonnes in 2008. Whilst

430,891 tonnes). Mining was hindered during the

In December 2007, production of a separate

by the local Chinese Engineering Institute and

precious metals concentrate containing gold, silver

below standard construction work followed by

recovery rates for zinc have held in excess of 95%

year by difficulties in sourcing supplies, most

through 2008, recovery rates for lead, gold and

notably explosives, during the Olympic and

and lead commenced from an integrated circuit

forming part of the main processing facilities at

Caijiaying. Previously gold, silver and lead were lost

to the smelters in the zinc concentrate.

certain Chinese contractors. Construction was

silver have not yet met expectations and further

Paraplegic Olympic Games in Beijing and delays in

then further significantly disrupted by the Olympic

work is being undertaken in an attempt to improve

accessing the lower mine levels. The inability to

and Paraplegic Olympic games held in Beijing in

recovery rates. With the development of the lower

access the lower levels has resulted in having to

the summer of 2008, which severely interrupted

levels of the mine, grades, particularly for gold, are

revert to shrink stoping to extract ore as opposed to

supplies of equipment. As a result, the upgrade

expected to improve as drilling results indicate

up-hole benching. Greater use of up-hole

Considerable work has been undertaken since

remains ongoing with sufficient progress on the

higher gold grades at lower levels.

benching, which allows for increased extraction

commissioning to increase production with the

upgrade of the processing plant being made such

rates albeit with greater dilution, will be made to

installation of, inter alia, a new back-fill plant, new

that processing rates equivalent to 600,000 tonnes

The Mine continues to rank in the lowest quartile

extract ore from the lower levels which are expected

floatation circuits, new accommodation and

of ore per annum have already been achieved.

of zinc producer costs. The commissioning of the

to be more amenable to such mining methods.

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RESOURCES

In 2008, 7,392 meters (2007: 7,200 meters) of

In 2008 work was started on the development of a

underground drives, rises and cross cuts were

drive connecting Zone III and the extended Fox

RESOURCE ESTIMATE AND RECONCILIATION
ZONE III

Resource in close proximity to existing development.

Significant tonnages of mineralisation were defined

developed. During 2008, within the area of current

decline at Zone II. This will give services and

mining activities at Zone III, over 35,570 metres

haulage access to the Zone II resources for future

(2007: 34,000 metres) of underground infill and

development. It will also provide a suitable drilling

exploration diamond drilling was completed.

platform and allow cost effective underground

exploration drilling of the area between Zones III

Following the discovery of mineralisation and the

and II.

preparation of an initial resource estimate in 2007

at Zone II (approximately 1.5 kilometres to the

The Caijiaying mine operated throughout 2008

south of Zone III), a further 120 meters of

without any significant accident or environmental

underground drives were constructed from the

incident, retaining an excellent safety and

“Fox” exploration decline at Zone II. This

environmental record.

development was undertaken to enable further

exploration drilling in the future.

Caijiaying Mine Site - Plant Upgrade Construction

During 2008, approximately 34,000 metres of

diamond drilling was completed. The programme

breakdown was 9,000 metres of infill and 25,000

metres of extensional drilling. Several exploratory

within the Qing Long, Ju Long, Fu Long, Chang

Long and Xiao Long lodes. An updated Mineral

Resource estimate is underway with results expected in

the third quarter of 2009.

probe holes were also drilled to the west of the

Tabulated below is the updated Mineral Resource

Qing Long lode. Extensional drilling targeted higher

estimate to JORC reporting standards for Zone III

grade zones within the 2002 Inferred Mineral

at Caijiaying.

Micromine 2002 Mineral Resource Estimate (Non Grade Control Drilling)

Category

Cut Tonnes
-off Millions

Metal Grade

Zinc % Gold

Silver

grammes grammes
per tonne per tonne

Contained Metal
Gold
million
ounces

Zinc
million
tonnes

Silver
million
ounces

Measured

Indicated

Inferred

Total

1.18

2.83

0.89

4.9

6.7

5.6

4.5

5.7

0.4

0.6

0.08

0.16

0.04

0.28

0.02

0.05

0.02

0.09

1.34

2.97

0.64

4.94

The information in this report that relates to the Mineral Resource Estimate for the 31 December 2008 grade control drilled areas is based on
information compiled by Mr L Marshall BSc. MAIG. The mining depletion of the FinOre 2006 Mineral Resource estimate was carried out by
Mr L Marshall. Mr. Marshall is a full time employee of Griffin Mining Ltd. The information relating to the FinOre 2006 Mineral Resource
and the Micromine2002 Mineral Resource estimates were compiled by Mr C Fawcett BSc (Hons),G Dip Eng, MAusIMM of FinOre and Mr
D Pertel MSc. MAIG. of Micromine Consulting Ltd. Mr Marshall, Mr Fawcett and Mr Pertel have sufficient experience which is relevant to
the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons
as defined by the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2004 edition).

G R I F F I N M I N I N G L I M I T E D

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The table summarises the Mineral Resource as at

The depleted FinOre 2006 Mineral Resource was

The figure below is the FinOre 2006 Mineral

control drilling) and the 2002 Inferred Mineral

31 December 2008 for:

estimated by reporting the block model with

Resource and the 2008 Mineral Resources (grade

Resource (historic surface drilling only).

• The grade control drilled area defined by the

FinOre 2006 Mineral Resource estimate

yearly surveyed void pickups removed up to the

2008 calendar year inclusive. The result was

compared with the production figures for 2008.

• The non grade control drilled area defined by

Production reported 431,000 mined tonnes,

the Micromine 2002 Mineral Resource estimate

where the resource depletion reported 319,000

mined tonnes. The difference is attributed to the

There was no change to the depleted Micromine 2002

mining of an estimated 112,000 tonnes of

Mineral Resource estimate as no mining took place

mineralisation from outside the FinOre 2006

from within the depleted resource reported in 2007.

Mineral Resource block model.

Mineral Resource Estimates for Zone II

Material

Tonnes

INDICATED

Oxide

Transitional

Fresh

Sub-total

INFERRED

Oxide

Transitional

Fresh

Sub-total

230,000

330,000

3,430,000

3,990,000

130,000

430,000

940,000

1,500,000

TOTAL

5,490,000

Note: Rounding errors may occur

Zn
%

1.9

3.3

3.1

2.4

2.9

3.8

3.4

3.2

Pb
%

0.7

0.8

0.5

0.8

0.7

0.6

Au
grammes
per tonne

Ag
grammes
per tonne

0.3

0.2

0.3

0.2

0.3

0.4

0.3

20.0

22.7

25.7

25.1

21.2

16.7

25.5

22.6

24.4

The information in this report that relates to the Mineral Resource estimates for Zone II is based on information compiled by Mr G. Fahey
of CSA Australia Pty Ltd (CSA). Mr Fahey is a Chartered professional and Member of The Australasian Institute of Mining and Metallurgy
and a Member of the Australian Institute of Geoscientists. Mr Fahey has sufficient experience which is relevant to the style of mineralisation
and type of deposit under consideration and to the activity which they are undertaking to qualify as a Competent Person as defined in the
2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (the JORC Code). Mr
Fahey consents to the inclusion in the report of the matters based on his information in the form and context in which they appear.

EXPLORATION

CAIJIAYING AREA

Hebei Anglo’s tenement boundary continues to

confirm the area to be highly prospective,

indicating significant potential for further base

Mineralisation at Caijiaying is believed to be related

metal and gold deposits.

to a Jurassic igneous event that affected the 2.3

billion year old metamorphic basement rocks. Base

HEBEI HUA’ AO LICENCE AREA

metal and gold mineralisation associated with

Jurassic intrusives have replaced favourable horizons

The 1.5 kilometre long area between Zones II and

in the metamorphic rocks, most notably calc-silicates

III has long been considered prospective for

and marble. Porphyry sills and dykes intruding along

additional zinc deposits but drilling has proved

faults have then cut across the sequence.

difficult due to either local access restrictions or deep

sandy overburden. Zone III contains the current

On-going exploration in the area surrounding the

Mine and at Zone II, approximately 1.5 kilometres

mine at Caijiaying and within Hebei Hua’ Ao’s and

to the south of Zone III, drilling in previous years

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Front End Loader Placing Ore into Jaw Crusher on Caijiaying Mine Site ROM Pad

G R I F F I N M I N I N G L I M I T E D

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HEBEI ANGLO LICENCE AREA

A detailed review of the ground magnetic data in

length of mineralisation another few kilometres.

the Hebei Anglo

licence area revealed an

The programme had to be abandoned due to poor

anomalous circular magnetic anomaly to the east of

drilling conditions resulting from very broken

Zone II, termed the Xiaobazi Prospect. During

ground. The concept remains untested.

2008, a

field programme was undertaken

comprising geological mapping and the collection

Newly developed geochemical techniques are

of 422 soil and 98 rock samples. Assaying revealed

currently being evaluated to determine if they can

the presence of gold, copper, zinc, molybdenum

be used to discover mineralisation beneath aeolian

and lead geochemical anomalies.

sands. This sand blankets a large part of the

tenement block thereby hindering exploration.

A short drilling programme was undertaken to test

The ability to “see through” this cover would be a

a concept that mineralisation extended across the

major advance in exploration of the Caijiaying

F45 fault. Success would have extended the strike

region and for all areas covered by similar sands.

Superimposed Diagrammatic View of Underground Mine Workings at Caijiaying: Courtesy of Google Maps

defined an initial JORC resource estimate of 5.49

haulage and services access when mining

million tonnes of 3.2% zinc, 0.6% lead, 0.3 grams

commences from this area.

per tonne gold and 24 grams per tonne silver.

During 2008, the Fox decline was extended an

Activities in 2008 concentrated on linking access

additional 110 metres. The underground

between Zone II and Zone III by extending the Fox

exploration programme planned for 2008 had to be

decline from Zone II northwards towards Zone III

postponed, despite considerable effort, as the

and developing a drive southwards from Zone III

recruitment of suitably qualified and experienced

towards Zone II. The aim of this work was firstly,

geological and drilling personnel proved impossible

to provide a more practical drilling platform than

to find because of the world-wide mining boom

drilling from the surface through soft aeolian sand

which existed at that time. It is expected the

as further significant resources are expected to be

programme will commence in the current year. An

defined at between Zone II and Zone III as this

increase in ore resources is expected as underground

should provide additional ore for the processing

drilling moves northwards towards Zone III.

facilities at Caijiaying, and secondly, to facilitate

Magnetic Image of Caijiaying Tenement Field

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Applied research is being undertaken by Dr

YUKON ZINC CORPORATION

Zhaoshan Chang of the ARC Centre of Excellence

in Ore Deposits at the University of Tasmania as

In keeping with Griffin’s stated intention of

part of a research programme sponsored by Griffin.

acquiring further projects that meet the Company’s

The purpose of this study is to understand the

financial objectives, considerable time and effort

origin and controls of the mineralisation at

was expended in the past year reviewing potential

Caijiaying and to apply this knowledge to the

acquisition opportunities. In April 2008, the

discovery of additional orebodies in the area.

Company reached an agreement with the board of

CORPORATE DEVELOPMENTS

SHARE BUY BACKS

In May 2008, Griffin purchased from Citadel, and

cancelled, 79,851,818 shares at £0.765 per share

(68,181,818 of which were issued to Citadel at

£1.10 per share in July 2007 to raise $151.7m) for

a total sum payable of £61.1 million ($121.5m),

realising a net gain to the Company of in excess of

$30m recognized through reserves. The directors

of Griffin, having consulted with

its then

nominated adviser, considered that, at the time, the

terms of the transaction were fair and reasonable

insofar as its shareholders were concerned.

In October 2008, a further 68,000 shares were

purchased in the market for cancellation at an

average price of £0.146 per share and, in January

2009, a further 34,567 shares were bought back in

for cancellation in the market at an average price of

£0.15 per share.

directors of Yukon Zinc Corporation (“Yukon

Zinc”) for the acquisition of all of the issued

common stock of Yukon Zinc. With significant

cash and no debt, Griffin was in a position to fund

and provide expertise to bring Yukon Zinc’s 100%

owned Wolverine zinc-copper-lead-silver-gold

underground mine, which is located in an area with

a similar climate to that at Caijiaying, into

production. On 29 April 2008, Yukon Zinc

informed the Company that the board of directors

of Yukon Zinc intended to accept a cash offer from

Northwest Non Ferrous International Investment

Company Limited and Jinduicheng Molybdenum

Group Limited for the acquisition of all the issued

common stock of Yukon Zinc for a cash price of

C$0.22 per share. The Company notified Yukon

Zinc that it did not intend to increase its offer for

the shares of Yukon Zinc. Consequently Griffin

Drill Rig at Salmon Gums

SPITFIRE OIL LIMITED

Mr Mladen Ninkov and Mr Roger Goodwin, being

directors of both Griffin and Spitfire, provide

On 27 November 2008, Griffin purchased

Griffin with significant influence over Spitfire,

16,666,667 ordinary shares in Spitfire Oil Ltd

requiring Griffin to treat Spitfire as an associated

(“Spitfire”), representing a 39.2% interest in the

company and thereby recognise its share of

issued share capital of Spitfire, at £0.15 per share for

Spitfire’s financial results.

total cash consideration of £2,500,000

($4,542,000) from Citadel. This purchase enabled

For a period until 27 May 2008, Citadel held a 30.2%

received its negotiated break fee of C$2.5 million.

Griffin to acquire a strategic stake in a project that

interest in the issued share capital of Griffin,

meets Griffin’s investment criteria whilst spreading

accordingly the transaction was considered a related

both political and commodity risk. The opportunity

party transaction under the AIM Rules. In this

to acquire this strategic stake at such a favourable

regard, the directors of Griffin (with the exception of

price, being at a 75% discount to the initial public

Mladen Ninkov and Roger Goodwin), having

offering price, was considered and approved by

consulted with its then nominated adviser, considered

Griffin’s independent directors. All of Griffin’s

that the terms of the transaction were fair and

directors have experience in the oil and gas sector.

reasonable insofar as its shareholders are concerned.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

Spitfire was incorporated on 2 May 2007 and, on

Spitfire is developing its proprietary L2V™

lignite bulk samples were collected for use in

bolstered

its

technical expertise with

the

11 July 2007, acquired the entire issued capital of

process to extract oil and other products from the

various laboratory test work.

employment of a new Scientific Officer, Mr Barry

Spitfire Oil Pty Ltd (formerly Hurricane Fuels Pty

lignite at Salmon Gums. The L2V™ process is a

Ltd) by way of a share swap. On 18 July 2007,

form of Pyrolysis, a variation of the coal coking

Spitfire’s shares were admitted to trading on AIM

process which has been used for over 100 years and

under the symbol “SRO”. At the same time,

which is known to extract oils and gases from coals.

Spitfire placed 16,666,667 new Ordinary Shares

The technology being developed by Spitfire will be

All drilling data and analyses are being entered into

a database to generate a new lignite resource

Tindall, who is a coal-to-liquids specialist with over

10 years experience with Sasol of South Africa,

including the design and commissioning of coal to

estimate with

the view of producing an

liquids technology.

independent updated JORC Indicated Resource

with Citadel at £0.60 per share to raise £10,000,000

compact with an environmental footprint that is

estimate by July 2009.

(before expenses).

much smaller than that of the much more complex

but conventional Fisher-Tropsch process. Low

Spitfire’s principal activity is the pursuance of the

carbon emissions are a necessity in the current

production of fuel oil, distillate and other by-

world climate. Production of a barrel of useable

products from the Salmon Gums Lignite deposits in

fuel from the L2V™ process is expected to

Western Australia. At 31 December 2008, Spitfire

generate a quarter of the emissions from that

held 36,800 hectares of exploration tenements and

generated by the conventional gasification plus

had applied for two Mining Leases, totalling 9,854

Fisher-Tropsch process. In the context of the

hectares, containing the bulk of the lignite resource.

proposed Australian carbon Emissions Trading

These tenements are near Salmon Gums, some

Scheme, at a price of A$25 per tonne of CO2, the

100km north of Esperance, in the south-east of

L2V™ process would incur a cost of about A$4.10

Western Australia. The tenements contain a large

per barrel of produced oil whilst the more

Whilst the main focus of the drilling in the field

program has been on exploration and resource

delineation, a number of important other activities

have also taken place during 2008 including:

Subsequently, Professor Chun-Zhu Li joined the

Curtin faculty as head of CAESE where he will lead

the research. Professor Li came from Monash

University where he spent years studying Victoria

Brown Coal and had carried out extensive research

in various areas of energy science and engineering

a helicopter electromagnetic survey;

including coal and biomass pyrolysis. Since these

a hydro-geological investigation, including

appointments good progress has been made on

flow tests from 5 wellbores;

further proving of the L2V™ Process Technology,

an aerial LIDAR survey to provide up-to-date

in particular:

•

photogrammetry over the license area;

an aerial multi-spectral survey providing

detailed environmental and botanical data;

lignite (brown coal) deposit with a JORC Inferred

conventional process would incur a cost in excess of

and

Resource (>10m thick seam) of 500 million tonnes

A$16.6 per barrel.

of lignite. The lignite has a high Kerogen

(hydrocarbon) content which, based on Spitfire’s

Since November 2007 Spitfire has been

•

further testing of the L2V™ Process

Technology.

testwork on a limited number of samples, indicates

undertaking field delineation and exploration

In June 2007, Spitfire’s wholly owned subsidiary,

that oil may be recoverable from the deposit at an

drilling with 420 holes drilled to date totalling

Spitfire Oil Pty Ltd, entered into a A$4.4 million

average yield of approximately 69 litres per tonne of

12,624 metres. The resource delineation program

multi-year research contract with Curtin University

lignite (in situ) or 0.43 barrel per tonne. This

consisted of infill drilling, special on-lake drilling,

of Technology’s Centre for Advanced Energy

implies a potential recoverable fuel oil resource of

logging and coring with the aim of bringing the

Science and Engineering (“CAESE”) to pursue the

approximately 200 million barrels (or 33 billion

previously defined Inferred Resource to Indicated

optimisation of the L2V™ process. The program

litres) throughout the deposit. Salmon Gums is

status. The exploration drilling program consisted

of test work had fallen behind schedule, principally

located next to a main road, railway and pipeline

of additional air-core drilling

in the area

due to the original head of the centre moving to

•

a new, specifically designed, laboratory has

been completed at Curtin University;

detailed lignite characterisation, small scale

pyrolysis and small-scale materials handling

and lignite drying tests have been performed;

larger scale handling and drying tests were

contracted to Tsing Hua University in Beijing;

optimum “off the shelf” industrial lignite

drying technology has been identified;

Spitfire’s prototype rotary kiln laboratory

reactor has been constructed, commissioned

and from which oil production has started;

analysis of the produced oil commenced; and

a new, fluidised bed, laboratory reactor has

connecting Kalgoorlie and the port of Esperance.

surrounding the resource. In addition, 12 tons of

another tertiary institution. As a result, Spitfire has

been conceived and procurement started.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

Following consultation with

the relevant

This move brings Spitfire’s administration closer to

IVERNIA TAKEOVER

THE FUTURE

Commonwealth

and State

environmental

Griffin’s. In June 2008, Mr Thyl Kint was

agencies in Australia it has been determined that

appointed Chief Executive Officer of Spitfire,

On 24 March 2009, Griffin announced its intention

In relation to the Company’s current Mine,

development of Salmon Gums project will be

replacing Mr Andrew Woskett who resigned from

to make a cash offer (“the Offer”), through a wholly

operations are expected to re-commence on 1 June

assessed for its environmental impact by way of

the board of directors. Mr Kint is an energy

owned subsidiary, to acquire all of the issued and

2009. With indications that commodity prices will

an Environmental Review and Management Plan

industry professional with over 25 years worldwide

outstanding common shares of Ivernia Inc

begin to increase in the foreseeable future, the

which includes an eight week period for public

oil and gas experience including, most recently, the

("Ivernia"). Ivernia holds a 100% interest in the

financial future of the Company is well placed. Zinc,

comment. Extensive baseline flora, fauna, salt

position of Project Director for the very large

Magellan lead mine in Western Australia, closed by

in particular, suffered from the recent bull market of

lake ecology, waste rock characterisation and

Stybarrow and Pyrenees oil and gas projects in

the Western Australian State Government for the

2004 – 2006 and the trading of zinc metal and its

groundwater studies were completed during

Australia operated by BHP Billiton Petroleum.

past two years following an environmental incident

derivatives by hedge funds. A subsequent correction

2008.

Following these changes, Spitfire is in a much

involving

the shipment of

lead carbonate

and a change in market conditions following the

stronger position to undertake the tasks ahead and

concentrate to the Port of Esperance.

credit crisis has caused zinc prices to fall to

Consultations with the local communities have

realise the objectives of achieving viable oil

unsustainable levels with a significant proportion of

been ongoing for some time. During 2008 the

production from the Salmon Gums lignite deposits.

On 3 April 2009, Griffin announced it had

zinc mines recently operating at a loss. This has

communities from the nearby port of Esperance

withdrawn its proposed takeover of Ivernia as a

resulted in a number of mine closures including the

and local town of Salmon Gums were canvassed

With dwindling world resources and

the

result of actions taken by the board of Ivernia

Galmoy Mine in Ireland, the Lennard Shelf in

and public meetings were held at both locations.

expectation of significant increases in the price of

which resulted in the current and future control of

Australia as well as a considerable number of mines

These attracted significant interest from local

oil in the future, this alternative energy project is

Ivernia being delivered to a related and other

in China. Whilst refined zinc output is expected to

residents and landholders. The area’s community,

highly attractive. Should the results from the

parties with latent massive dilution of up to 111%

grow only modestly in the near future, tightness of

businesses and local government have been

L2VTM tests be successful and the development of

of its share capital without the approval of Ivernia’s

concentrate supply is already resulting in lower

generally supportive of the Spitfire’s plans.

a commercial plant be achievable, Griffin has the

shareholders or allowing the shareholders to be

treatment charges and a strengthening of zinc prices.

potential to reap significant financial rewards upon

given the opportunity to consider a number of

Contact has also been made with various Australian

the Salmon Gums project coming into commercial

alternative proposals put forward by Griffin. In

Griffin’s management team, consisting of finance,

State and Federal Government bodies for support

operation.

such a situation, the total consideration which

mining, metallurgy, geological and health and

for Spitfire’s activities. With the resource being

would have had to be paid for the newly diluted

safety professionals, have reviewed over 600 mining

West Australian based and the L2V™ Process

Although Spitfire’s primary objective remains the

share capital of Ivernia by Griffin was not

companies and their key projects during the year.

offering an attractive alternative source of energy,

commercialisation of its L2V lignite-to-liquids

considered either justified or certain and, as such,

Of these, approximately 50 were selected for semi-

Spitfire has been favourably received.

technology over the large resource at the Salmon

not in the best interest of Griffin shareholders.

detailed evaluation and 20 for further involved

In 2008 Spitfire moved its principal office and

possible synergistic business opportunities and

management from Melbourne to Perth, the capital

continue to evaluate and pursue other energy

of Western Australia, where its project is located.

related opportunities.

Gums, management have considered other

detailed analysis. The companies selected held

predominantly advanced projects in a range of

commodities and locations. In addition, Griffin has

been approached by a number of companies with a

view to jointly developing a number of significant

projects. This process remains ongoing.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

Flotation Cells in the Caijiaying Plant

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

DIRECTORS & SENIOR EXECUTIVES

Mladen Ninkov, Chairman, Australian, aged 47,

Meagher & Flom in New York and Freehill

Dal Brynelsen, Director, Canadian, aged 62, is

Jeff Haitian Sun, General Manager China,

holds a Masters of Law Degree from Trinity Hall,

Hollingdale & Page in Australia. He has been

a graduate of the University of British Columbia in

Chinese, aged 48, is a Professor of Geology based

Cambridge and Bachelor of Laws (with Honours)

chairman and director of a number of both public

Urban Land Economics. Mr. Brynelsen has been

in Beijing. He holds a PhD and MSc in mineral

and Bachelor of Jurisprudence Degree from the

and private mining companies.

University of Western Australia. He is the principal

of Keynes Capital. He has a mining, legal, fund

Roger Goodwin, Finance Director, British,

management and investment banking background

aged 54, is a Chartered Accountant. He has been

and is admitted as a barrister and solicitor of the

with the Company since 1996 having previously

involved in the resource industry for over 30 years.

deposits

from

the Chinese University of

He has been responsible for the discovery,

Geosciences and has undertaken postdoctoral

development and operation of several underground

research in geology at the Norwegian University of

gold mines during his career. Mr. Brynelsen is the

Technology. Jeff has worked on a number of

President and a director of Vangold Resources

mineral projects both in China and overseas. Prior

Supreme Court of Western Australia. He was the

held senior positions in a number of public and

Limited.

to joining Griffin he was engaged by Mundoro

Mining Inc of Canada as a senior geologist.

Chairman and Managing Director of the Dragon

private companies within the natural resources

Capital Funds management group, a director and

sector. He has a strong professional background,

Head of International Corporate Finance at ANZ

including that as a manager with KPMG, with

Grindlays Bank Plc in London, and a Vice

considerable public company and corporate finance

President of Prudential-Bache Securities Inc. in

experience, and experience of emerging markets

New York. He also worked at Skadden Arps Slate

particularly in Africa, the CIS and Eastern Europe.

DIRECTORS: (Left to Right): Back Row: Dal Brynelsen (Non-Executive), Roger Goodwin (Finance Director)
Front Row: William Mulligan (Non Executive), Mladen Ninkov (Chairman)

William Mulligan, Director, USA, aged 65, has

a BSc from Thomas Clarkson University, an MS in

Timothy Blyth, Operations Manager

Geological Engineering from the University of

Caijiaying, Australian, aged 49, holds an

Connecticut and an MBA from NYU Bernard

Associate Diploma in Geology from the Canberra

Baruch School of Business Administration. He is

Institute of Technology and has 24 continuous

currently the Managing Director for Global

years experience in the Australian mining industry,

Projects and Political Risk at AIG Global Trade

with the last 10 years in senior management

and Political Risk Insurance Company, a wholly

positions. Having started as an underground

owned subsidiary of American International Group

geologist, he also has significant experience of open

Inc., and a director of AIG Investment Bank (ZAO)

pit mining. Prior to joining Griffin he spent the

Ltd based in Moscow. From 1994 to 1996 he was

previous 5 years as Operations Manager and

Executive Vice President

for Corporate

Project Manager for Hill 50 Gold, Harmony and

Development at Latin American Gold Limited.

Perilya. Previously he was a Chief Geologist

(Geology Manager) for 5 years for Sons of Gwalia

SENIOR EXECUTIVES

and then Hill 50 Gold.

Dominic Claridge, Operations Manager,

Australian, aged 45, holds a degree in mining

engineering from the University of Sydney

(Australia). He has been involved in the mining

industry

for over 20 years having worked

predominately with Australian mining companies,

with short interludes in South Africa and Finland. He

has worked in a variety of operations encompassing

both underground and open cut mining, from small

to medium sized mines. More recently he has worked

in China as deputy general manager for an

underground gold operation and was project

manager for a new gold operation in Australia.

William Zhang, Finance Manager China, aged

31, is an Australian resident and citizen of China.

He holds a Bachelor of Commerce degree from

University of Melbourne, and is an associate

member of the Certified Public Accountants of

Australia. He has a mining, accounting and finance

background having worked on a number of coal

mining projects both in China and Australia,

including; Yanzhou Coal (a coal mining company

listed in NYSE, SEHK, SSE) and Fiserv Solutions

(a financial service firm listed in NASDAQ).

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

Moving Concentrate at New Storage Shed at Caijiaying Mine Site

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

DIRECTORS’ REPORT

The Directors submit their report together with the audited consolidated accounts of Griffin Mining Limited (“the Company”)
and its subsidiaries (“the Group”) for the year ended 31 December 2008.

The options exercisable at 20 pence per share entitle the holder to subscribe for new ordinary shares in the Company on or
before 31st October 2013. The options vest with each option holder in 3 separate and equal instalments as follows:

FINANCIAL RESULTS

The Group profit before taxation, amounted to US$6,959,000 (2007: US$26,762,000). Taxation of US$637,000 has been
provided (2007: nil). A dividend of US$8,008,000 was paid in 2008 (2007: US$5,826,000). After deduction of dividends paid,
US$1,686,000 has been debited to reserves (2007: credit - US$20,936,000).

The earnings per share amounted to 2.87 cents (2007: 12.08 cents). The attributable net asset value per share at 31 December
2008 amounted to 72 cents (2007: 95 cents).

In view of the fall in commodity prices resulting in the decline in profitability, current suspension of operations at Caijiaying,
and the consequent need to preserve cash, the directors do not recommend the payment of a dividend.

PRINCIPAL ACTIVITIES

The principal activity of the Group is that of mining and exploration. A review of the Group’s operations for the year ended 31
December 2008 and the indication of likely future developments are set out on pages 8 to 25.

DIRECTORS

The Directors of the Company during the year were:

Mladen Ninkov – Australian – Chairman
Roger Goodwin – British – Finance Director
Dal Brynelsen – Canadian
William Mulligan – American (US)

Under the bye laws of the Company, the Directors serve until re-elected at the next Annual General Meeting of the Company.
Being eligible all the Directors currently in office offer themselves for re-election at the forthcoming Annual General Meeting
of the Company.

The beneficial interests of the Directors holding office at 31 December 2008 and their immediate families in the share capital
of the Company were as follows:

Name

At 31 December 2008

Ordinary
shares
No.

Options over
ordinary shares
exercisable at

At 1 January 2008

Ordinary
shares
No.

Options over
ordinary shares
exercisable at

20 pence

110 pence

65 pence

110 pence

65 pence

Mladen Ninkov
Dal Brynelsen
Roger Goodwin
William Mulligan

33,001
1
577,830
300,001

3,000,000
200,000
600,000
200,000

6,000,000
400,000
1,200,000
400,000

2,000,000
200,000
575,000
200,000

33,001
1
577,830
300,001

6,000,000
400,000
1,200,000
400,000

2,000,000
200,000
575,000
200,000

The options exercisable at 65 pence per share entitle the holder to subscribe for new ordinary shares in the Company on or
before the 28 February 2009 and have all vested. Since the 31 December 2008, all the options exercisable at 65 pence per share
have lapsed.

The options exercisable at 110 pence per share entitle the holder to subscribe for new ordinary shares in the Company on or
before 28 February 2010. The options vest with each option holder in 3 separate and equal instalments as follows:

a. The first third of each holder’s options vested on 31 December 2007;

b. The second third of each holder’s options vested on 31 December 2008; and

c. The last third of each holder’s options will vest on 31 December 2009.

a. The first third of each holder’s options vested on 28th October 2008;

b. The second third of each holder’s options will vest on 31 December 2009; and

c. The last third of each holder’s options will vest on 31 December 2010.

The options exercisable at 110 pence and 20 pence will not vest if an employee or a director resigns or leaves the Company for
cause prior to the vesting event taking place. All the Options will vest immediately upon a takeover offer being made or a change
in substantial control of the Company taking place prior to the Options expiring.

All of the Directors’ interests detailed are beneficial.

CORPORATE GOVERNANCE

Although incorporated in Bermuda and therefore not obliged to comply with the code of best practice established by the
Combined Code issued by the Committee on Corporate Governance, the Company has reviewed and broadly supports this code.
The Company does not comply where compliance would not be commercially justified allowing for the practical limitations
relating to the Company’s size.

The Board of directors includes a number of non executive directors who, other than their shareholdings, are independent and
free from any business or other relationship which could materially interfere with the exercise of their independent judgement.
The Board meets regularly, at least once a quarter, and is responsible for the overall strategy of the Group, its performance,
management and major financial matters. All directors are subject to re-appointment annually at each annual general meeting
of the Company’s shareholders.

Various safeguards and checks have been instigated as part of the Company’s system of financial control. These include:

•

preparation of regular financial reports and management accounts

preparation and review of capital and operational budgets

preparation of regular operational reports

prior approval of capital and other significant expenditure

regular review and assessment of foreign exchange risk and requirements

AUDITORS

Grant Thornton UK LLP have indicated their willingness to continue in office as auditors to the Company and a resolution
proposing their appointment will be put to the forthcoming Annual General Meeting.

STATEMENT OF DIRECTORS’ RESPONSIBILITIES IN RESPECT OF THE ACCOUNTS

Bermudan company law and generally accepted best practice requires the Directors to prepare accounts for each financial year
which give a true and fair view of the state of affairs of the Group and of the profit or loss of the Group for that period. In
preparing these accounts, the Directors have:

•

selected suitable accounting policies and applied them consistently;

made judgements and estimates that are reasonable and prudent;

stated whether applicable accounting standards have been followed, subject to any material departures disclosed
and explained in the accounts; and

prepare the financial statements on a going concern basis unless it is inappropriate to presume the Company will
continue in business.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

DIRECTORS’ REPORT

REPORT OF THE INDEPENDENT AUDITOR

In so far as the directors are aware:

REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF GRIFFIN MINING LIMITED

•

there is no relevant information of which the Company’s auditors are unaware; and

the directors have taken all steps that they ought to have taken as directors to make themselves aware of relevant
audit information and to establish that the auditors are aware of that information.

The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the
financial position of the Group and enable them to ensure that the financial statements comply with the Bermuda Companies
Act 1981 as amended. They are also responsible for safeguarding the assets of the Group and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the corporate and financial information included in the
Company’s website. Legislation in Bermuda and the United Kingdom governing the preparation and dissemination of financial
statements may differ from the legislation in other jurisdictions.

This report was approved by the Board and signed on its behalf by

Roger Goodwin

Finance Director and Company Secretary

30 April 2009

London

We have audited the financial statements of Griffin Mining Limited for the year ended 31 December 2008 which comprise the
consolidated income statement, the consolidated balance sheet, the consolidated statement of changes in equity, the consolidated
cash flow statement, the accounting policies, and notes 1 to 26. These financial statements have been prepared under the
accounting policies set out therein.

This report is made solely to the Company's members, as a body, in accordance with Section 90 of the Bermuda Companies
Act 1981 as amended. Our audit work has been undertaken so that we might state to the Company's members those matters we
are required to state to them in an auditors' report and for no other purpose. To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than the Company and the Company's members as a body, for our audit work,
for this report, or for the opinions we have formed.

RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITOR

The Directors' responsibilities for preparing the Annual Report and the financial statements in accordance with applicable
Bermuda law and International Financial Reporting Standards as adopted by the EU are set out in the statement of directors'
responsibilities. Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory
requirements and International Standards on Auditing (United Kingdom and Ireland).

We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in
accordance with International Financial Reporting Standards. We also report to you if, in our opinion, the Directors' Report
is not consistent with the financial statements, if the Company has not kept proper accounting records, or if we have not received
all the information and explanations we require for our audit.

We read other information contained in the Annual Report and consider whether it is consistent with the audited financial
statements. This other information comprises the Chairman's Statement, Review of Operations and Directors' Report. We
consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the
financial statements. Our responsibilities do not extend to any other information.

BASIS OF AUDIT OPINION

We conducted our audit in accordance with International Standards on Auditing (United Kingdom and Ireland) issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in
the financial statements. It also includes an assessment of the significant estimates and judgements made by the Directors in the
preparation of the financial statements, and of whether the accounting policies are appropriate to the Group's circumstances,
consistently applied and adequately disclosed.

We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order
to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material
misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.

OPINION

In our opinion:

•

the financial statements give a true and fair view in accordance with International Financial Reporting
Standards as adopted by the EU of the state of the Group’s affairs at 31 December 2008 and of its profit
for the year then ended;

•

the financial statements have been properly prepared in accordance with the provisions of the Bermudan
Companies Act 1981 as amended.

GRANT THORNTON UK LLP
REGISTERED AUDITORS
CHARTERED ACCOUNTANTS
LONDON
30 April 2009

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

CONSOLIDATED INCOME STATEMENT

CONSOLIDATED BALANCE SHEET

For the year ended 31 December 2008
(expressed in thousands US dollars)

Notes

Revenue

Cost of sales

Gross profit

Net operating expenses

Profit from operations

Share of losses of associated company
Foreign exchange (losses) / gains
Finance income
Other income
Interest payable

Profit before tax

Income tax expense

Profit after tax attributable to equity share owners
for the financial year

Basic earnings per share (cents) from continuing operations

Diluted earnings per share (cents) from continuing operations

5
6

2008

$000

32,061

(18,438)

2007

$000

37,989

(7,768)

13,623

30,221

(10,517)

(10,078)

3,106

(39)
(3,221)
4,670
2,533
(90)

6,959

(637)

20,143

-
1,012
5,607
-
-

26,762

6,322

26,762

2.87

2.83

12.08

11.97

As at 31 December 2008
(expressed in thousands US dollars)

Notes

ASSETS
Non-current assets
Property, plant and equipment
Intangible assets – exploration interests
Investment in associated company

Current assets
Inventories
Other current assets
Cash and cash equivalents

Total assets

EQUITY AND LIABILITIES
Equity attributable to equity holders of the parent
Share capital
Share premium
Contributing surplus
Share based payments
Other reserves
Foreign exchange reserve
Profit and loss reserve
Total equity

Non-current liabilities
Long-term provisions

Current liabilities
Trade and other payables
Short term bank overdrafts

Total liabilities

Total equities and liabilities

Number of shares in issue

9
10
11

12
13

18
19

2008
$000

56,885
1,313
4,503
62,701

3,227
5,564
67,193
75,984

138,685

1,816
75,950
3,690
5,826
711
7,142
35,345
130,480

2007
$000

44,381
751
-
45,132

4,639
4,155
199,949
208,743

253,875

2,615
196,637
3,690
4,426
579
3,109
37,106
248,162

8,107
-

5,047
666

8,107

5,713

138,685

253,875

181,589,731

261,509,549

Attributable net asset value / total equity per share

$0.72

$0.95

The accounts on pages 36 to 57 were approved by the Board of Directors and signed on its behalf by:

Mladen Ninkov
Chairman

30 April 2009

Roger Goodwin
Finance Director

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31 December 2008
(expressed in thousands US dollars)

Capital Premium

Share Contributing
Surplus

Other

Share
Profit
Based Reserves Exchange and Loss
Reserve Reserve

Foreign

Payments

Total

For the year ended 31 December 2008
(expressed in thousands US dollars)

Notes

$000

At 31 December 2006

1,841

39,166

3,690

2,553

297

479

16,432

64,458

Exchange differences on
translating foreign operations

Net income recognised
directly in equity

Profit for the year

Total recognised income
and expenses in the year

Dividend paid

Regulatory transfer for
future investment

Exercise of share options

1,042

Issue of share capital

774

156,429

Cost of share based payments

(1,042)

2,915

262

2,630

2,650

26,762

2,630

26,762

29,412

(5,826)

(262)

157,203

2,915

At 31 December 2007

2,615

196,637

3,690

4,426

579

3,109

37,106

248,162

Exchange differences on
translating foreign operations

Net income recognised
directly to equity

Profit for the year

Total recognised income
and expenses in the year

Dividend paid

Regulatory transfer for
future investment

Purchase of shares for
cancellation

(799)

(120,687)

Cost of share based payments

1,400

4,033

4,090

6,322

4,033

6,322

10,412

(8,008)

(75)

- (121,486)

1,400

At 31 December 2008

1,816

75,950

3,690

5,826

711

7,142

35,345

130,480

Net cash flows from operating activities
Profit before taxation
Share of associated company losses
Foreign exchange losses / (gains)
Taxation paid
Finance income
Adjustment in respect of share based payments
Depreciation, depletion and amortisation
Provisions
Decrease / (increase) in inventories
(Increase) in other current assets
Increase in trade and other payables

Net cash inflow from operating activities

Cash flows from investing activities
Interest received
Payments to acquire intangible fixed assets – exploration interests
Payments to acquire plant and equipment – mineral interests
Payments to acquire plant and equipment – plant and equipment
Payments to acquire interest in associated company
Net cash (outflow) from investing activities

Cash flows from financing activities
Issue of ordinary share capital
Expenses paid in connection with share issue
Purchase of share for cancellation

5
10
9
9

2008
$000

6,959
39
3,221
(637)
(4,670)
1,400
2,844
98
1,412
(1,101)
3,059

12,624

4,670
(388)
(9,393)
(1,681)
(4,542)
(11,334)

-
-
(121,486)
(121,486)

2007
$000

26,762
-
(1,012)
-
(5,607)
2,915
1,351
-
(3,535)
(3,091)
711

18,494

5,607
(126)
(9,056)
(1,854)
-
(5,429)

157,211
(7)
-
157,204

Dividends Paid

(8,008)

(5,826)

(Decrease)/Increase in cash and cash equivalents

(128,204)

164,443

Cash and cash equivalents at beginning of the year
Effects of exchange rate changes
Cash and cash equivalents at the end of the year

Cash and cash equivalents comprise:
Bank deposits
Short term bank overdrafts
Total

199,283
(3,886)
67,193

67,193
-
67,193

34,081
759
199,283

199,949
(666)
199,283

Included within net cash flows of $128,204,000 (2007: $164,443,000) are foreign exchange losses of $3,221,000 (2007 gains:
$1,012,000) which have been treated as realised.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

ACCOUNTING POLICIES

BASIS OF ACCOUNTING

CONSOLIDATION BASIS

The accounts have been prepared in accordance with applicable International Financial Reporting Standards as issued by the
International Reporting Standards Board and as adopted by the European Union.

The significant accounting policies adopted are detailed below:

ACCOUNTING CONVENTION

The accounts have been prepared under the historical cost convention, except for financial assets which are measured at fair
value.

ISSUED INTERNATIONAL FINANCIAL REPORTING STANDARDS (“IFRS’S”) AND
INTERPRETATIONS THAT ARE NOT YET EFFECTIVE

The Group has not applied the following pronouncements: Those of which are expected to be most relevant to the Group are
IFRS 8 and IAS 27 (revised).

IAS 1 Presentation of financial statements (revised 2007) – effective 1 January 2009

IAS 23 Borrowing Costs (revised 2007) - effective 1 January 2009

IAS 27 Consolidated and separate financial statements (revised 2007) – effective 1 July 2009.

- Amendment to IAS 32 Financial Instruments: Presentation and IAS 1 Presentation of Financial Statements - Puttable

Financial Instruments and Obligations Arising on Liquidation - effective 1 January 2009.

- Amendment to IFRS 2 Share based payment – Vesting conditions and cancellations – effective 1 January 2009

- Amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards and IAS 27 Consolidated
and Separate Financial Statements - Costs of Investment in a Subsidiary, Jointly Controlled Entity or Associate - effective
1 January 2009.

- Amendment to IAS 39 Financial Instruments: Recognition and Measurement - Eligible Hedged Items - effective 1 July

2009.

IFRS 3 Business combinations (revised 2008) – effective 1 January 2009

IFRS 8 Operating Segments – effective 1 January 2009.

IFRIC 16 Hedges of a Net Investment in a Foreign Operation – effective 1 October 2008

The Group is evaluating the impact of the above pronouncements. The effect of the revision to IAS 27 will depends on the
extent of relevant future transactions including the reduction in the Group's interest in Hebei Hua Ao. Otherwise, the changes
are not expected to be material to the Group's earnings or to shareholders' funds.

The Group accounts consolidate the accounts of the Company and all its subsidiary undertakings drawn up to 31 December
each year. Subsidiaries are entities over which the Group has the power to control the financial and operating policies so as to
obtain benefits from its activities. The Group obtains and exercises control through voting rights.

Unrealised gains on transactions between the Group and its subsidiaries are eliminated. Unrealised losses are also eliminated
unless the transaction provides evidence of an impairment of the asset transferred. Amounts reported in the financial statements
of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group.

Acquisitions of subsidiaries are dealt with by the purchase method. The purchase method involves the recognition at fair value
of all identifiable assets and liabilities, including contingent liabilities of the subsidiary, at the acquisition date, regardless of
whether or not they were recorded in the financial statements of the subsidiary prior to acquisition. On initial recognition, the
assets and liabilities of the subsidiary are included in the consolidated balance sheet at their fair values, which are also used as
the bases for subsequent measurement in accordance with the Group accounting policies. Goodwill is stated after separating
out identifiable intangible assets. Goodwill represents the excess of acquisition cost over the fair value of the Group's share of
the identifiable net assets of the acquired subsidiary at the date of acquisition.

Under the terms of the joint venture contract establishing the Hebei Hua’ Ao Mining Industry Company Limited, the Company
provided all the funds required to develop the Caijiaying mine and was entitled to 100% of the net cash flows of the subsidiary
for the first three years after commencement of commercial production. With effect from 24 July 2008 the Company’s share of
the cash flows and profits reverted to the underlying equity interest of 60%.

No minority interest in Hebei Hua’ Ao Mining Industry Company Limited is recognised in these financial statements as
Hebei Hua’ Ao Mining Industry Company Limited has operated at a loss since July 2008.

No minority interest in Hebei Sino Anglo Mining Development Company Limited is recognised in these financial statements
as the minority interest’s share of capital is extinguished by losses.

ASSOCIATES

Entities whose economic activities are independent of the Group are accounted for using the equity method.

Associates are those entities over which the Group has significant influence but which are neither subsidiaries nor interests in
joint ventures. Investments in associates are recognised initially at cost and subsequently accounted for using the equity method.
Acquired investments in associates are also subject to purchase method accounting. However, any goodwill or fair value
adjustment attributable to the share in the associate is included in the amount recognised as investment in associates.

All subsequent changes to the share of interest in the equity of the associate are recognised in the Group's carrying amount of
the investment. Changes resulting from the profit or loss generated by the associate are reported in "share of profits of associates"
in the consolidated income statement and therefore affect net results of the Group. These changes include subsequent
depreciation, amortisation or impairment of the fair value adjustments of assets and liabilities.

Items that have been recognised directly in the associate's equity are recognised in the consolidated equity of the Group.
However, when the Group's share of losses in an associate equals or exceeds its interest in the associate, including any unsecured
receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the
associate. If the associate subsequently reports profits, the investor resumes recognising its share of those profits only after its
share of the profits equals the share of losses not recognised.

Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group's interest in the
associates. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Amounts reported in the financial statements of associates have been adjusted where necessary to ensure consistency with the
accounting policies adopted by the Group.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

ACCOUNTING POLICIES

REVENUE

MINE CLOSURE COSTS

Revenue is measured by reference to the fair value of consideration received or receivable by the Group and comprises amounts
received, net of VAT and production royalties, from sales of metal concentrates to third party customers. Sales are made on a
cash on delivery / collection basis and are recognised on collection or delivery of the concentrate from the Group’s processing
facilities.

Mining operations are generally required to restore mine and processing sites at the end of their lives to a condition acceptable
to the relevant authorities and consistent with the Group’s environmental policies. Whilst the Group strives to maintain and
where possible enhance the environment of the Group’s processing sites, provision is made for site restoration costs in the
accounts in accordance with local requirements.

NON CURRENT ASSETS

Intangible assets – exploration cost

INVENTORIES

Inventories are valued at the lower of cost or net realisable value.

Expenditure on licences, concessions and exploration incurred on areas of interest by subsidiary undertakings are carried as
intangible assets until such time as it is determined that there are commercially exploitable reserves within each area of interest
and the necessary finance in place, at which time such costs are transferred to property, plant and equipment to be amortised
over the expected productive life of the asset. The Group’s intangible assets are subject to periodic review at least annually by
the Directors for impairment. Exploration, appraisal and development costs incurred in respect of each area of interest
determined as unsuccessful are written off to the Income Statement.

Costs incurred in bringing each product to its present location and condition are accounted for as follows:

•

Consumable stores and spares, at purchase costs on a first in first out basis

Concentrate stockpiles at cost of direct materials, power, labour, and a proportion of site overhead

Ore stockpiles at cost of direct material, power, labour contractor charges and a proportion of site overhead

Property, plant and equipment

Mine development expenditure for the initial establishment of access to mineral reserves, together with capitalised exploration,
evaluation and commissioning expenditure, and direct overhead expenses prior to commencement of commercial production are
capitalised to the extent that the expenditure results in significant future benefits.

Property, plant and equipment are shown at cost less depreciation and provisions for the impairment of value (see note 9).

Residual values

Material residual value estimates are updated as required, but at least annually whether or not the asset is revalued.

Depreciation

All costs capitalised (mineral interest, mill and mine equipment) within an area of interest, are amortised over the current
estimated economic reserve of the area of interest on a unit of production basis.

Office equipment is depreciated over four years on a straight line basis.

Impairment

An impairment test is carried out at each balance sheet date to assess whether the net book value of the capitalised costs in each
area of interest, together with the costs of development of undeveloped reserves, is covered by the discounted future net
revenues from reserves within that area of interest. Any deficiency arising is provided for to the extent that, in the opinion of
the Directors, it is considered to represent a permanent diminution in value of the related asset, and where arising, is dealt with
in the income statement as additional depreciation.

FINANCIAL ASSETS

Financial assets, other than hedging instruments, can be divided into the following categories:

•

loans and receivables

financial assets at fair value through profit or loss

available-for-sale financial assets

held-to-maturity investments

Financial assets are assigned to the different categories on initial recognition, depending on the characteristics of the instrument
and its purpose. A financial instrument's category is relevant for the way it is measured and whether resulting income and expenses
are recognised in profit or loss or charged directly against equity.

The Group generally recognises all financial assets using settlement day accounting. An assessment of whether a financial asset
is impaired is made at least at each reporting date. Financial assets that are substantially past due or when objective evidence is
received that a specific counterparty will default, are also considered for impairment. All income and expense relating to financial
assets are recognised in the income statement line item "finance costs" or "finance income", respectively.

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active
market. They are classified as current assets or non current assets based on their maturity date. Loans and receivables are classified
as either ‘trade and other receivables’ or ‘other financial assets’ in the balance sheet. On initial recognition loans and receivables
are recognised at fair value net of transaction costs. They are subsequently measured at amortised cost using the effective interest
method, less provision for impairment. Any change in their value is recognised in profit or loss. The Group’s other receivables
fall into this category of financial instruments.

Impairment assessments are based upon a range of estimates and assumptions:

The Group has no financial assets at fair value through profit or loss or held-to-maturity investments.

Estimate / assumption

Basis

Future production

Proven and probable reserves and resource estimates together with processing capacity

FINANCIAL LIABILITIES

Commodity prices

Forward market and longer term price estimates

Exchange rates

Current market exchange rates

Discount rates

Cost of capital risk

The Group’s financial liabilities include borrowings, trade and other payables, which are measured at amortised cost using the
effective interest rate method. On initial recognition loans and receivables are recognised at fair value net of transaction costs.

Financial liabilities are recognised when the Group becomes a party to the contractual agreements of the instrument. All interest-
related charges and, if applicable, changes in an instrument's fair value that are reported in profit or loss are included in the
income statement line items "finance costs" or "finance income".

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

ACCOUNTING POLICIES

FOREIGN CURRENCY TRANSACTIONS

SIGNIFICANT JUDGEMENTS AND ESTIMATES

The accounts have been prepared in United States dollars being the local currency of Bermuda. Whilst registered in Bermuda
the Company, together with its subsidiaries and associates, operate in China, the United Kingdom, and Australia.

In formulating accounting policies the directors are required to apply their judgement, and where necessary engage professional
advisors, with regard to the following significant areas:

Foreign currency transactions by Group companies are recorded in their functional currencies at the exchange rate ruling at the
date of the transaction.

Monetary assets and liabilities have been translated at rates in effect at the balance sheet date. Any realised or unrealised exchange
adjustments have been charged or credited to income.

On consolidation the accounts of overseas subsidiary undertakings are translated into the presentation currency of the Group
at the rate of exchange ruling at the balance sheet date and profit and loss account items are translated at the average rate for
the year. The exchange difference arising on the retranslation of opening net assets is classified within equity and is taken directly
to the foreign exchange reserve. All other translation differences are taken to the profit and loss account.

The balance of the foreign currency translation reserve relating to an operation that is disposed of is transferred to the income
statement at the time of the disposal.

EQUITY

Equity comprises the following:

"Share capital" represents the nominal value of equity shares.

"Share premium" represents the excess over nominal value of the fair value of consideration received for equity
shares, net of expenses of the share issue.

"Contributing surplus" is a statutory reserve for the maintenance of capital under Bermuda company law and was
created on a reduction in the par value of the Company’s ordinary shares on 15 March 2001.

•

Expenditure capitalised as intangible fixed assets (note 9)

Expenditure capitalised as property, plant & equipment (note 9)

Impairment review assumptions (note 9, 10 and 11)

Provisions for mine closure costs (note 17)

Share based payments (note 15)

Classification of share based payments (note 15)

Determination that investments in associates are not subsidiaries (note 11)

Treatment of minority interests (notes 13, 23 and 26)

The directors continually monitor the basis on which their judgements are formulated. Where required they will make
amendments to these judgements. Where judgements and estimates are amended between accounting periods, full disclosure of
the financial implications are given within the relevant notes to the Group accounts.

CASH AND CASH EQUIVALENTS

Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term, highly liquid investments
that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.

"Share based payments" represents equity-settled share-based employee remuneration until such share options
are exercised.

DIVIDENDS

"Foreign exchange reserve" represents the differences arising from translation of investments in overseas
subsidiaries.

"Other reserve" represents a statutory retained earnings reserve under PRC law for future investment by Hebei
Hua-Ao.

Dividend distributions payable to equity shareholders are included in "other short term financial liabilities" when the dividends
are approved in a directors meeting prior to the balance sheet date.

TAXATION

"Profit and loss reserve" represents retained profits and losses.

Current tax is the tax currently payable based on taxable profit for the year.

EQUITY SETTLED SHARE BASED PAYMENTS

All share-based payment arrangements granted after 7 November 2002 that had not vested prior to 1 January 2005 are recognised
in the financial statements.

All goods and services received in exchange for the grant of any share-based remuneration are measured at their fair values. Fair
values of employee services are indirectly determined by reference to the fair value of the share options awarded. Their value
is appraised at the grant date and excludes the impact of non-market vesting conditions (for example, production upgrades).

All share-based remuneration is ultimately recognised as an expense in the income statement with a corresponding credit to
"Share based payments" in the balance sheet.

If vesting periods or other non-market vesting conditions apply, the expense is allocated over the vesting period, based on the
best available estimate of the number of share options expected to vest. Estimates are subsequently revised if there is any
indication that the number of share options expected to vest differs from previous estimates. Any cumulative adjustment prior
to vesting is recognised in the current period. No adjustment is made to any expense recognised in prior periods if share options
ultimately exercised are different to that estimated on vesting.

Upon exercise of share options the proceeds received net of attributable transaction costs are credited to share capital.

For the financial year ended 31 December 2008 the application of the accounting standard has resulted in a net decrease in the
profit for the year of $1,400,000 (2007: $2,915,000).

Deferred income taxes are calculated using the liability method on temporary differences. Deferred tax is generally provided
on the difference between the carrying amounts of assets and liabilities and their tax bases. However, deferred tax is not provided
on the initial recognition of goodwill, nor on the initial recognition of an asset or liability unless the related transaction is a
business combination or affects tax or accounting profit. Deferred tax on temporary differences associated with shares in
subsidiaries and joint ventures is not provided if reversal of these temporary differences can be controlled by the Group and it
is probable that reversal will not occur in the foreseeable future. In addition, tax losses available to be carried forward as well
as other income tax credits to the group are assessed for recognition as deferred tax assets.

Deferred tax liabilities are provided in full, with no discounting. Deferred tax assets are recognised to the extent that it is probable
that the underlying deductible temporary differences will be able to be offset against future taxable income. Current and deferred
tax assets and liabilities are calculated at tax rates that are expected to apply to their respective period of realisation, provided
they are enacted or substantively enacted at the balance sheet date.

Changes in deferred tax assets or liabilities are recognised as a component of tax expense in the income statement, except
where they relate to items that are charged or credited directly to equity (such as the revaluation of land) in which case the related
deferred tax is also charged or credited directly to equity

•

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

NOTES TO THE FINANCIAL STATEMENTS

1. SEGMENTAL REPORTING

3. DIRECTORS’ AND KEY PERSONNEL REMUNERATION

The Group has one business segment, the Caijiaying zinc gold project in the Peoples Republic of China, which is its primary
segment for the purposes of financial reporting. All sales and costs of sales in 2008 and 2007 were derived from the Caijiaying
zinc gold project.

REVENUES
China

COST OF SALES
China

NET OPERATING EXPENSES
China
Australia
European Union

All revenues, cost of sales, and operating expenses charged to profit relate to continuing operations.

TOTAL ASSETS
China
Australia
European Union

CAPITAL EXPENDITURE
China

2. PROFIT FROM OPERATIONS

Profit from operations is stated after charging

Depreciation, depletion and amortisation
Staff costs
Fair values of options granted to directors and management

Average number of persons employed by the Group in the year

69,041
4,662
64,982
138,685

11,462
11,462

2008
$000
(2,844)
(3,966)
(1,400)

No.
200

2008
$000

2007
$000

32,061

37,989

(18,438)

(7,768)

(6,379)
(76)
(4,062)
(10,517)

The following fees and remuneration were receivable by the Directors holding office and key personnel engaged during the year:

Mladen Ninkov
Dal Brynelsen
Roger Goodwin
William Mulligan

Key personnel

Fees

$000
58
65
58
65
246
-
246

Salary Bonuses Share based Total
2008
$000
898
221
636
136
1,120 1,891
280 1,055
1,400 2,946

payments
$000
840
56
168
56

$000
-
-
359
-
359
775
1,134

$000
-
100
51
15
166
-
166

Fees

Salary

$000
45
66
45
66
222
-
222

$000
-
-
365
-
365
801
1,166

Share based
payments
$000
1,744
116
349
116
2,325
588
2,913

Total
2007
$000
1,789
182
759
182
2,912
1,389
4,301

(4,735)
15
(5,358)
(10,078)

54,841
79
198,955
253,875

11,036
11,036

2007
$000
(1,351)
(2,301)
(2,915)

No.
200

Keynes Capital, the registered business name of Keynes Investments Pty Limited as trustee for the Keynes Trust, received fees
under a consultancy agreement of $1,013,000 (2007 $932,000), for the provision of advisory and support services to Griffin
Mining Limited and its subsidiaries during the year, 60% of which fees are charged to Hebei Hua Ao. In addition Keynes
Capital received a fee of $327,000 charged solely to Griffin Mining Ltd. Mladen Ninkov is a director and employee of Keynes
Investments Pty Limited.

On 27 October 2008 the Company agreed to grant further options over 5,000,000 new ordinary shares to directors and key
employees of the Company (the "New Options"). Each New Option entitles the holder to subscribe for new ordinary shares in
the Company at an exercise price of 20 pence per new ordinary share on or before 31 October 2013. The New Options vest
with each option holder in 3 separate and equal instalments per annum as follows:

The first third of each holder’s New Options vested on 28 October 2008;

The second third of each holder’s New Options will vest on 31 December 2009; and

The last third of each holder’s New Options will vest on 31 December 2010.

The New Options will not vest if an employee or a director resigns or leaves the Company for cause prior to the vesting event
taking place. All the New Options will vest immediately upon a takeover offer being made or a change in substantial control
of the Company taking place prior to the New Options expiring.

The new options have been allocated as follows:

Directors:
Mladen Ninkov
Roger Goodwin
Dal Brynelsen
William Mulligan
Management
Key Personnel

Total

New Options
granted

Total number of

Options now held

Total number of
Options vested

3,000,000
600,000
200,000
200,000

1,000,000

5,000,000

11,000,000
2,375,000
800,000
800,000

7,000,000
1,575,000
533,333
533,333

4,800,000

2,933,334

19,775,000

12,575,000

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

NOTES TO THE FINANCIAL STATEMENTS

4. SHARE OF LOSSES OF ASSOCIATED COMPANY

8. EARNINGS PER SHARE

Share of losses of Spitfire Oil Ltd

2008
$000
39

2007
$000
-

The calculation of the basic earnings per share is based upon the earnings attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the year. The calculation of diluted earnings per share is based on the basic
earnings per share on the assumed conversion of all dilutive options and other dilutive potential ordinary shares.

Reconciliation of the earnings and weighted average number of shares used in the calculations are set out below:

5. FINANCE INCOME

Interest income on bank deposits

6. OTHER INCOME

Break fee received on aborted acquisition of Yukon Zinc, net of expenses
Other

7. INCOME TAX EXPENSE

Profit for the year before tax

Tax rate

Expected tax expense

Adjustment for tax exempt items:
- Income and expenses outside the PRC not subject to tax
- Share of associated company losses

Adjustments for timing differences
- PRC rebates on purchasing Chinese equipment
- In respect of accounting differences

Taxation charge

2008
$000
4,670

2008
$000
2,495
38
2,533

2008
$000
6,959

12.5%

870

97
(5)

(333)
8

637

2007
$000
5,607

2007
$000
-
-
-

2007
$000
26,762

0.0%

-
-

The Company is not resident in the United Kingdom for taxation purposes.

Hebei Hua’ Ao paid income tax in the PRC at a rate of 12.5% in 2008 based upon the profits calculated under Chinese generally
accepted accounting principals (Chinese “GAAP”). Hebei Hua’ Ao currently benefits from a reduced tax rate for past investment
with the applicable PRC tax rate rising in future years in steps to 25%.

Hebei Hua' Ao benefited from a Tax holiday until 2008.

2008

Earnings

$000

Weighted
average
number of
shares

Per
share
amount
(cents)

Earnings

$000

2007

Weighted
average
number
of shares

Per
share
amount
(cents)

6,322

220,587,242

2.87

26,762

221,441,986

12.08

3,090,342

2,153,244

Basic earnings per share
Earnings attributable to
ordinary shareholders

Dilutive effect of securities

Options

Diluted earnings per share

6,322

223,677,584

2.83

26,762

223,595,230

11.97

Mill and
Mineral
interests mine equipment
$000

$000

Office furniture
and equipment
$000

9. PROPERTY, PLANT AND EQUIPMENT

At 1 January 2007 net of accumulated depreciation
Foreign exchange adjustments
Additions during the year
Transfers from exploration interests
Transfers from long term provisions re mine closure
costs on payment of rehabilitation bonds
Depreciation charge for the year
At 31 December 2007
Foreign exchange adjustments
Additions during the year
Transfers of rehabilitation bonds to other assets
Depreciation charge for the year
At 31 December 2008

At 1 January 2007
Cost
Accumulated depreciation
Net carrying amount

At 31 December 2007
Cost
Accumulated depreciation
Net carrying amount

At 31 December 2008
Cost
Accumulated depreciation
Net carrying amount

21,220
2,500
9,056
162

(384)
(733)
31,821
3,287
9,393
(308)
(2,011)
42,182

$000

21,574
(354)
21,220

32,937
(1,116)
31,821

45,521
(3,339)
42,182

10,848
457
1,854
-

-
(608)
12,551
1,295
1,681
-
(828)
14,699

$000

11,970
(1,122)
10,848

14,336
(1,785)
12,551

17,517
(2,818)
14,699

Total

$000

32,087
2,957
10,910
162

(384)
(1,351)
44,381
4,582
11,074
(308)
(2,844)
56,885

19
-
-
-

-
(10)
9
-
-
-
(5)
4

$000

46
(27)
19

46
(37)
9

46
(42)
4

33,590
(1,503)
32,087

47,319
(2,938)
44,381

63,084
(6,199)
56,885

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

NOTES TO THE FINANCIAL STATEMENTS

9. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

Mineral interests comprise the Group’s interest in the Caijiaying ore bodies including fair values on acquisition, plus subsequent
expenditure on licences, concessions, exploration, appraisal and construction of the Caijiaying mine including expenditure for
the initial establishment of access to mineral reserves, commissioning expenditure, and direct overhead expenses prior to
commencement of commercial production and together with the end of life restoration costs.

In undertaking impairment tests and considering the value of the mineral interests, mill and other equipment at Caijiaying, the
directors have recognised the need for a revised mining licence to inter alia extract ore from below the 1300 level and ensure the
long term viability of the mine. Whilst an application for such licence has been made, a revised licence has at the date of these
accounts not been granted. The directors are not aware of any good reason or cause why the revised licence would not be
granted. Having considered the geology, resource estimations, and ore block models at the mine area above the 1300 level, the
directors consider that sufficient ore remains above the 1300 level, to justify the carrying value of mineral interests, and related
equipment at Caijiaying.

The office furniture and equipment disclosed above relates solely to the fixed assets of the Company.

10. INTANGIBLE ASSETS

China – Zinc / gold exploration interests

At 1 January 2007
Foreign exchange adjustments
Additions during the year
Transfer to mineral interests
At 31 December 2007
Foreign exchange adjustments
Additions during the year
At 31 December 2008

$000
842
(55)
126
(162)
751
174
388
1,313

Intangible assets represent fair values on acquisition, plus subsequent expenditure on licences, concessions, exploration, appraisal
and development work. Where expenditure on an area of interest is determined as unsuccessful such expenditure is written off
to the income statement. The recoverability of these assets depends, initially, on successful appraisal activities, details of which
are given in the report on operations. The outcome of such appraisal activity is uncertain. Upon economically exploitable mineral
deposits being established, sufficient finance will be required to bring such discoveries into production. At 31 December 2008
no amounts had been provided or charged to the income statement in respect of the above exploration costs.

11. INVESTEMENT IN ASSOCIATED COMPANY

At 1 January 2008
Additions in year
Share of losses of Spitfire Oil Limited
At 31 December 2008

2008
$000
-
4,542
(39)
4,503

2007
$000
-
-
-
-

Griffin acquired 16,666,667 ordinary shares in Spitfire Oil Ltd (“Spitfire”), representing a 39.2% interest in the issued share
capital of Spitfire, at 15p per share for a total cash consideration of £2,500,000 ($4,542,000) on 27 November 2008. The directors
consider that the fair value on acquisition of the underlying investment of Spitfire Oil Ltd equates to the fair value paid by the
Company. No goodwill or value has been attributed on the acquisition of Griffin's interest in Spitfire Oil Ltd to its licences,
proprietary or other rights, in view of the early stage nature of Spitfire Oil Ltd's development.

Mladen Ninkov and Roger Goodwin are directors of Spitfire Oil Ltd giving Griffin significant influence over the financial and
operating policy decisions of Spitfire.

Spitfire’s principal activity is the pursuance of the production of fuel oil and distillate from the Salmon Gums Lignite deposits
in Western Australia.

Summarised financial information on Spitfire Oil Limited
(expressed in thousands Australian dollars)

Six months to
31 December 2008
Unaudited
Aus$000

13 months to
30 June 2008
Audited
Aus$000

Loss before income tax

(686)

(2,828)

ASSETS
Current assets
Non-current assets
Total assets

LIABILITIES
Current and total liabilities

NET ASSETS

EQUITY
Issued capital
Reserves
Accumulated losses

31 December 2008
Unaudited
Aus$000

30 June 2008
Audited
Aus$000

11,908
6,504
18,412

14,331
3,457
17,788

(374)

(1,172)

18,038

16,616

20,854
827
(3,643)
18,038

20,854
(1,409)
(2,829)
16,616

Spitfire Oil Ltd reported no contingent liabilities at 31 December 2008 (30 June 2008 nil).

The directors have considered the carrying value of the Company’s investment in Spitfire Oil Limited by reference to current
market conditions, underlying assets and to projected discounted cash flow projections of Spitfire Oil Limited’s principal venture.

12. INVENTORIES

Underground ore stocks
Surface ore stocks
Concentrate ore stocks
Spare parts and consumables

2008
$000
628
1,627
63
909
3,227

2007
$000
1,006
223
2,869
541
4,639

All inventories are expected to be sold, used or consumed within one year of the balance sheet date. Inventories costing
$3,973,000 (2007: $7,768,000) were charged to the income statement in 2008.

13. OTHER CURRENT ASSETS

Other receivables
Prepayments

2008
$000
3,537
2,027
5,564

2007
$000
1,695
2,460
4,155

Other receivables include advances of $3,080,000 to related parties, recoverable from future share of profits (note 24). The
minority share of the losses of Hebei Hua' Ao Mining Industry for 2008 amounting to $663,000 (2007: nil) have been fully
provided against.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

NOTES TO THE FINANCIAL STATEMENTS

14. SHARE CAPITAL

AUTHORISED:
Ordinary shares of US$0.01 each

CALLED UP ALLOTTED AND FULLY PAID:
Ordinary shares of US$0.01 each
At 1 January
Issued during the year
Bought back in for cancellation
At 31 December

2008

2007

Number

$000

Number

$000

1,000,000,000

10,000

1,000,000,000

10,000

261,509,549
-
(79,919,818)
181,589,731

2,615
-
(799)
1,816

184,061,064
77,448,485
-
261,509,549

1,841
774
-
2,615

On 27 May 2008 79,851,818 ordinary shares were bought in for cancellation from Citadel Equity Fund Ltd at £0.765 ($1.52)
per share.

On 28 October 2008 68,000 ordinary shares were bought in for cancellation from the market at 14.7 UK pence ($0.26) per share.

15. SHARE OPTIONS AND WARRANTS (CONTINUED)

Inputs into the Binomial valuation model were as follows:

Share price
Exercise price
Expected volatility
Risk free rate
Dividend yield

Options expiring
28 February 2013

Options expiring
28 February 2010

Options expiring
28 February 2009

14.0p
20.0p
60%
3.97%
4%

105.8p
110.0p
33%
5.1%
0%

65.75p
65.0p
30%
4.31%
0%

Expected volatility was determined by calculating the historical volatility of the Company’s share price with reference to the
correlation with the zinc price and zinc price volatility over the same period. The Binomial model used assumes that the options
will be exercised early when the share price exceeds the exercise price by a multiple of two.

The Group recognised a total expense of $1,400,000 (2007: $2,915,000) during the year ended 31 December 2008 relating to
equity settled share option scheme transactions.

15. SHARE OPTIONS AND WARRANTS

16. DIVIDENDS

Options exercisable at 65 pence per share to 28 February 2009
Options exercisable at 110 pence per share to 28 February 2010
Options exercisable at 20 pence per share to 28 February 2013

At 1 January
2008
Number

Granted At 31 December
2008
Number
Number

5,475,000
10,000,000
-
15,475,000

-
-
5,000,000
5,000,000

5,475,000
10,000,000
5,000,000
20,475,000

The following table shows the number and weighted average exercise price of all the unexercised share options and warrants at
the year end:

Outstanding at 1 January

Granted during the year

Exercised during the year

Outstanding at 31 December

2008
Number Weighted average
exercise price

2007
Number Weighted average
exercise price

15,475,000

5,000,000

20,475,000

94.1

20.0

76.0

14,741,667

10,000,000

(9,266,667)

15,475,000

43.0

110.0

30.0

94.1

The estimated value of the options exercisable at 65p up to 28 February 2009, which vested in 3 tranches of 1,825,000 each, were
14.81p, 14.93p and 15.10p. All the options exercisable at 65p vested in 2006, but lapsed on 28 February 2009.

The estimated value of the options exercisable at 110p up to 28 February 2010, which vested in 3 tranches of 3,333,333 each,
were 25.19p, 25.87p and 26.52p. Two thirds of these options had vested at 31 December 2008.

The estimated value of the options exercisable at 20p up to 31 October 2013, which vested in 3 tranches of 1,666,666 each, were
4.0p, 4.2p and 4.42p. One third of these options had vested at 31 December 2008.

On 6 June 2008 a final dividend of 3 cents per ordinary share in the Company was paid.

17. LONG-TERM PROVISIONS

PROVISIONS FOR MINE CLOSURE COSTS

At 1 January
Transfer to mineral interests on payment of rehabilitation bond
Transfer
At 31 December

2008
$000
-
-
98
98

During 2007 the Group paid a bond under PRC regulations to be used to cover end of mine life restoration costs.

18. TRADE AND OTHER PAYABLES

Trade payables
Taxation payable
Accruals

2008
$000
7,649
-
458
8,107

2007
$000
384
(384)
-
-

2007
$000
2,995
605
1,447
5,047

All amounts are short term. The carrying values of all trade and other payables are considered to be a reasonable approximation
of fair value.

19. SHORT TERM BANK OVERDRAFTS

Short term bank overdrafts comprised an 8.52% fixed rate bank loan of Rmb5,000,000 ($666,000) repaid during 2008, which
was secured by way of a floating charge over Hebei Hua’ Ao’s concentrate stocks.

20. ATTRIBUTABLE NET ASSET VALUE / TOTAL EQUITY PER SHARE

The attributable net asset value / total equity per share has been calculated from the consolidated net assets / total equity of the
Group at 31 December 2008 of $130,480,000 ($248,162,000 at 31 December 2007) divided by the number of ordinary shares
in issue at 31 December 2007 of 181,589,731 (261,509,549 at 31 December 2007).

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

NOTES TO THE FINANCIAL STATEMENTS

21. RISK MANAGEMENT

Interest rate risk

The Group is exposed to a variety of financial risks which result from its operating and investing activities. The Group’s risk
management is coordinated by its senior management and executive directors and focuses on actively securing the Group’s short-
to-medium term cash flows.

Foreign Currency Risk

The majority of the Group’s operational and financial cash flows are denominated in Renminbi and United States Dollars with
sterling bank deposits held to cover future sterling expenditure estimates. Associates operational and financial cash flows are
denominated in Australian dollars.

Currently the Group does not carry out any significant operations in currencies outside the above.

The Group currently does not have a foreign currency hedging policy. However, the management monitors foreign exchange
exposure and will consider hedging significant foreign currency exposure should the need arise.

In addition, the conversion of Renminbi into foreign currencies is subject to the rules and regulations of the foreign exchange
control promulgated by the government of the PRC.

Sterling bank deposits are translated into United States Dollars at the closing rate are as follows:

Short term bank deposits

2008
$000

10,556

2007
$000

60,134

The following table illustrates the sensitivity of the net results for the year and equity in regards to the Group’s sterling deposits
and the sterling US Dollar exchange rate. It assumes a + / - 36% change in the sterling exchange rate for the year ended 31
December 2008. These changes are considered to be reasonable based on observation of current market conditions for the year
ended 31 December 2008. The sensitivity analysis is based upon the Group’s sterling deposits at each balance sheet date.

If sterling had strengthened against the US Dollar by 36% (2007: 9.6%) this would have had the following impact:

Net result for the year and on equity

2008
$000

5,938

If sterling had weakened against the US Dollar by 36% (2007 9.6%) this would have the following impact:

Net result for the year and on equity

2008
$000

(2,794)

2007
$000

6,386

2007
$000

(5,267)

Exposures to foreign exchange rates vary during the year depending on the volume of overseas transactions. Nonetheless, the
analysis above is considered to be indicative of the Group’s exposure to currency risk.

Foreign currency denominated financial assets and liabilities, translated into US Dollars at the closing rate, are as follows:

2008

Rmb
$000

GBP
$000

10,692

7,621

(158)

(7,855)

10,534

(234)

AusD
$000

160

(95)

2007

Rmb
$000

GBP
$000

60,895

5,093

(318)

(4,674)

60,577

419

AusD
$000

(55)

Financial assets

Financial liabilities

Short term exposure

The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s bank deposits with floating
interest rates. The Group currently does not have an interest rate hedging policy.

The following table illustrates the sensitivity of the net results for the year and equity to a reasonably possible change in
interest rates of + 300% and - 100% (2007 +/- 20%), with effect from the beginning of the year. These changes are considered
to be reasonable based on observation of current market conditions within which the Group operates. The sensitivity analysis
is based upon the Group’s deposits at each balance sheet date.

Net result for the year

2008

2007

Plus 300%

Minus 100%

Plus 20%

Minus 20%

$000

556

$000

(185)

$000

2,009

$000

(3,013)

Fixed and non interest bearing financial assets and liabilities are as follows:

FFllooaattiinngg
iinntteerreesstt
rraattee

2008

NNoonn
iinntteerreesstt
bbeeaarriinngg

TToottaall

Floating
interest
rate

2007

Non
interest
bearing

Total

$$000000

$000

67,193
-
67,193

-
-
-
67,193

-
3,537
3,537

-
8,107
8,107
(4,570)

67,193
3,537
70,730

-
8,107
8,107
62,623

199,949
-
199,949

-
-
-
199,949

-
1,695
1,695

199,949
1,695
201,644

-
4,442
4,442
(2,747)

-
4,442
4,442
197,202

Financial Assets
Cash at bank
Other receivables
Total Financial Assets

Trade payables
Other payables
Total Financial Liabilities
Net Financial (Liabilities)/Assets

Commodity risk

The Group is exposed to the risk of changes in commodity prices and in particular that for zinc, lead, gold and silver. The Group
currently sells its metal concentrate production by way of open auctions in China. The Group currently does not hedge its metal
production.

Credit risk

Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading
to a financial loss. The Group is exposed to credit risk from its financing activities, including deposits with banks and financial
institutions, foreign exchange transactions and other financial instruments. The Group does not have trade receivables and does
not hold collateral as security.

Credit risk from balances with banks and financial institutions is managed by the Board. Investments of surplus funds are made
only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed
by the Griffin Board on a regular basis. The limits are set to minimise the concentration of risks and therefore mitigate financial
loss through potential counterparty failure. No material exposure is considered to exist by virtue of the possible non performance
of the counterparties to financial instruments.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

22. FINANCIAL INSTRUMENTS

24. RELATED PARTY TRANSACTIONS

The Group does not enter into derivative transactions such as interest rate swaps, forward rate agreements or forward currency
contracts. With the exception of a fixed rate and fixed term Renminbi short term bank loan, the Group has no borrowings other
than trade creditors and funds in excess of immediate requirements are placed in US dollar and sterling short term fixed and
floating rate deposits. The Group has overseas subsidiaries operating in China and Australia, whose costs are denominated in
local currencies.

In the normal course of its operations the Group is exposed to commodity price, foreign currency and interest rate risks.

The Group places funds in excess of immediate requirements in US dollar and sterling deposits with a number of banks to spread
currency, interest rate and bank risk. These deposits are kept under regular review to maximise interest receivable and with
reference to future expenditure and future currency requirements.

Commodity prices are monitored on a regular basis to ensure the Group receives fair value for its products.

At 31 December 2008 Hebei Hua’ Ao Mining Industry Company Limited had advanced Rmb3,009,000 ($440,000) (31 December
2007 Rmb 3,009,000 ($400,000)) to the 3rd Geological Brigade of the Hebei Province, a partner in the local Chinese entity (the
Caijiaying Lead Zinc Preparatory Committee), that holds a 40% interest in Hebei Hua’ Ao. At 31 December 2008 Hebei Hua’
Ao had advanced Rmb18,003,000 ($2,640,000) (31 December 2007 Rmb 9,003,000 ($1,200,000)) to the Caijiaying Lead Zinc
Preparatory Committee. Both these loans are non-interest bearing and repayable from their future share of the profits of
Hebei Hua’ Ao.

25. COMMITMENTS

At 31 December 2008 the Group had capital commitments of $3,350,000 (31st December 2007 $2,858,000).

23. SUBSIDIARY COMPANIES

26. CONTINGENT LIABILITIES

As described in note 23, the joint venture contract establishing the Hebei Hua’ Ao Mining Industry Company Ltd provides
that 100% of the cash flows and profits generated by the joint venture in the first three years from commencement of commercial
production be paid to the foreign party (China Zinc). Thereafter, being with effect from 24 July 2008, the cash flows are
shared 60% by the foreign party and 40% by the Chinese party, in accordance with their share in the equity interest in the
joint venture. The registered capital (equity) of Hebei Hua' Ao was provided in full by China Zinc. Since 24 July 2008 Hebei
Hua’ Ao has incurred losses and in view of the uncertainties in recovering the Chinese partners’ share of these losses, full
provision has been made against the minority share of losses from 24 July to 31 December 2008. In view of the unusual nature
of the joint venture contract and uncertainty as to its interpretation, with all the registered capital of Hebei Hua’ Ao being
provided by China Zinc, no provision has been made for the minority interest in the net assets of Hebei Hua’ Ao. At 31
December 2008, the net assets of Hebei Hua’ Ao amounted to $10.7m. After allowing for the minority share of losses since 24
July 2008, the minority share of the net assets at 31 December 2008 on a termination of Hebei Hua’ Ao could amount to $3.6m.

At 31 December 2008, Griffin Mining Limited had interests in the share capital of the following principal subsidiary companies.

Name

Class of Share
held

Proportion of
shares held

Nature of
business

Country of
incorporation

China Zinc Pty Ltd

Ordinary

China Zinc Limited

Ordinary

Hebei Hua’ Ao Mining
Industry Company Ltd*

Panda Resources Ltd

Ordinary

Hebei Sino Anglo Mining
Development Company Ltd*

100%

60%**

100%

90%

Service company

Australia

Holding company

Hong Kong

Base and precious
metals mining and
development

China

Holding company

England

Mineral exploration
and development

China

* China Zinc Ltd, China Zinc Pty Ltd and Panda Resources Ltd are directly owned by the Company. China Zinc Ltd has a
controlling interest in Hebei Hua’ Ao Mining Industry Company Ltd, see below, and Panda Resources Ltd has a 90%
controlling interest in Hebei Sino Anglo Mining Development Company Ltd.

** The joint venture contract establishing the Hebei Hua’ Ao Mining Industry Company Ltd provides that 100% of the cash
flows generated by the joint venture in the first three years from commencement of commercial production (commenced in
the second half of 2005) be paid to the foreign party (China Zinc). Thereafter, being with effect from 24 July 2008, the foreign
party (China Zinc) receives 60% of the cash flows, in accordance with its share in the equity interest in the joint venture. The
minority share of the losses of Hebei Hua' Ao Mining Industry Company Ltd for 2008 amounting to $633,000 (2007 nil)
have been fully provided against.

G R I F F I N M I N I N G L I M I T E D

R E P O RT A N D A C C O U N T S 2 0 0 8

Administration Buildings at Caijiaying Mine Site

G R I F F I N M I N I N G L I M I T E D

CORPORATE INFORMATION

Principal office:

6th & 7th Floors, 60 St James’s Street, London. SW1A 1LE. UK.
Telephone: + 44 (0)20 7629 7772
Facsimile: + 44 (0)20 7629 7773
Email: griffin@griffinmining.com
Web site: www.griffinmining.com

Registered office:

Clarendon House, 2 Church Street, Hamilton. HM11. Bermuda.

China Zinc office:

Levels 9 & 11, BGC Centre, 28 The Esplanade, Perth, WA 6000. Australia.
Telephone: + 61 (0)8 9321 7143
Facsimile: + 61 (0)8 9321 7035

Directors:

Mladen Ninkov (Chairman)
Roger Goodwin (Finance Director)
Dal Brynelsen
William Mulligan

Company Secretary:

Roger Goodwin

Nominated Adviser
and Broker for AIM:

Investec Bank (UK) Limited
2 Gresham Street, London. EC2V 7QP. UK.

Auditors:

Solicitors:

Grant Thornton UK LLP
Grant Thornton House, Melton Street, London. NW1 2EP. UK.

Mallesons Stephen Jaques
Unit 2925, South Tower, Beijing Kerry Centre, 1 Guang Hua Road,
Chao Yang District, Beijing 100020. PRC

Conyers Dill & Pearman
Clarendon House, Church Street, P.O. Box HM 666, Hamilton. HMCX. Bermuda.

Addleshaw Goddard LLP
150 Aldergate Street, London. EC1A 4EJ. UK.

Bankers:

HSBC Bank plc
27-32 Poultry, London. EC2P 2BX. UK

National Westminster Bank PLC.
St James’s and Piccadilly, London. W1A 2DG. UK.

The Bank of Bermuda Ltd
6 Front Street, Hamilton. HM11. Bermuda.

UK Registrars
and Transfer Agents:

Capita Registrars (Jersey) Limited
12 Castle Street, St Helier, Jersey, JE2 3RT. UK.